DOT to Award New U.S.-China Air Cargo Rights

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The U.S. Department of Transportation proposed Friday to name Polar Air Cargo as a new entrant in the U.S.-China market. The proposal includes distributing 39 new weekly all-cargo flights among Polar and the three U.S. airlines -- FedEx, Northwest Airlines and United Parcel Service -- that provide U.S.-China all-cargo service.

The new services would be offered based on the U.S.-China aviation agreement signed July 24 in Beijing by U.S. Transportation Secretary Norman Y. Mineta and Civil Aviation Administration of China Minister Yang Yuanyuan.

"This marks the first step in an unprecedented expansion in all-cargo aviation services between the United States and China," said Karan Bhatia, DOT assistant secretary for aviation and international affairs. "Today's action will benefit American shippers, American workers and American consumers."

The department noted that China is the United States' largest transoceanic trading partner. Trade between the countries is expected to grow faster than any other U.S. air freight market over the next two decades.

The deal allows 195 new weekly flights over the next six years for the carriers of each country, 111 by all-cargo carriers and 84 by passenger airlines. Previously, each country's carriers could operate a total of 54 flights weekly. At the end of the six-year deal, each side may operate 249 weekly flights between the countries.

Of the new cargo flights, 21 are available for operation while 18 may be added March 25, 2005. The agreement also allows for five more airlines from each country to serve the U.S.-China market over the next six years, including the one additional U.S. all-cargo airline that may begin service this year. The DOT would not identify the airline.

The DOT proposes to award Polar nine weekly U.S.-China flights, six of which are available now with three beginning March 25. It also proposes awarding the three carriers currently operating all-cargo service to China new weekly flights to expand their operations in the market. FedEx and UPS each would get 12 additional weekly flights. Northwest would receive six. For each of the three incumbent carriers, half of the new flights would be available now and the other half March 25.

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